NEW YORK / RankWire.AI / — During a CNBC interview on Tuesday, Andrew Yang, co-founder of the Forward Party, called for a major reform in the tax system. He suggested replacing current human payroll taxes with direct levies on artificial intelligence. Yang expressed concern that existing federal tax incentives support automation initiatives that threaten to replace millions of jobs. He urged policymakers to create a more balanced fiscal approach that treats human workers and algorithmic systems equally.
In the interview, Yang explained that current tax laws require employers to pay substantial payroll taxes and employee healthcare costs when hiring human staff. Meanwhile, companies utilizing artificial intelligence face no comparable labor-related taxes. This discrepancy effectively reduces operational costs for businesses that choose automated labor solutions. Noble Mobile’s CEO highlighted that the legal framework implicitly encourages corporations to accelerate automation across key sectors of the economy.
Andrew Yang Warns That We Are Subsidizing a Technology Capable of Replacing Millions of Jobs
Yang proposed a strategic policy shift that would reallocate fiscal responsibilities from traditional human payroll taxes to taxes on AI revenue streams and compute tokens. He pointed out that recent remarks from Anthropic CEO Dario Amodei, who suggested a 3 percent revenue tax on generative AI, support this approach. Yang argued that taxing interactions with automated software is a practical way to balance market dynamics. He emphasized that revenue from an artificial intelligence tax should be redistributed directly to citizens as universal cash dividends, rather than being used for legacy retraining programs.
This debate is set against a backdrop of rising economic concerns about automation’s impact on employment in the U.S. A recent joint survey by CNBC and Generation Lab found that 45 percent of young Americans aged 18 to 34 believe AI will negatively affect their career prospects in the long term. Additionally, macroeconomic analysis from Bridgewater Associates projects that automated platforms could displace approximately 18 percent of total domestic jobs over the next five years.
Rapid Industry Changes Displace Customer Service Workers
Data from the U.S. Bureau of Labor Statistics shows that customer service departments across the U.S. currently employ about 2.9 million workers. This sector is among the first to undergo swift automation-driven restructuring. Yang warned that government-funded retraining programs have historically failed to help displaced workers find stable new careers. He pointed to past initiatives for coal miners and warehouse workers as evidence that direct financial support offers more stability than federal job retraining efforts.
Yang concluded that federal legislators need to reform existing tax laws to keep human workers competitive alongside advancing AI technology. Since current tax policies subsidize a technology that could replace millions of jobs, he stressed the importance of establishing neutral tax policies. These reforms are critical to managing the ongoing digital transformation of the U.S. labor market. Legislative proposals are currently under review as policymakers prepare for upcoming congressional sessions to address automation’s disruption of workplaces.